THE OFFSHORE REPORT

No. 3 - 2018

OFFSHORE SUPPORT AND SPECIALIZED VESSELS

www.fearnleyoffshoresupply.com 17th July 2018

 IN THIS REPORT
3 FRANKLY SPEAKING
4 NORTH SEA CHARTERING
14 FROM THE TIGER’S MOUTH
16 WHAT LIES BENEATH
18 THE SALE & PURCHASE MARKET

Front page photo: CLV “Seaway Aimery” (ex- Siem Aimery)

Photo courtersy of Siem Offshore
This page: christening of MPSV “Sayan Polaris”
Photo by Tor A. Widing

© FEARNLEY OFFSHORE SUPPLY AS

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2 The Offshore Report, No. 3 - 2018

FRANKLY SPEAKING
At the moment we find ourselves in a nuanced
situation where there are both positive and
negative developments in both the supply- and
the subsea segments. While it is beneficial to the
shipowners of subsea tonnage that these vessel
types have suffered far less oversupply than that
of AHTS and PSVs, the demand for their services in
the immediate future is already laid out to a large
degree as the marine campaign of prospective field
developments are well into the future. Thus with
a limited potential of additional work in the rest
of 2018 and 2019, we view the subsea segment in
general to face a flat albeit positive development
in terms of rates and utilization going forward.
Furthermore, is it a welcome development that
the contractor’s efforts to reduce cost and position
themselves strategically in order to offer integrated
services, is received well by the market. In fact, all
the major subsea players with alliances (Subsea
7 & One Subsea, Technip and FMC merger, and
McDermott & Baker Hughes) have now won projects
on this basis, with the exception of Aker Solutions
and Saipem. With at least half a dozen large FIDs
expected to be awarded before year-end, there is
still plenty to be optimistic about for the latter pair.
For the supply vessel segments however, the
massive oversupply that still very much plagues the
industry is slowly but steadily being reduced, and
here the potential for additional vessel demand
is much quicker to materialize. We register an
overall trend of more vessel trading on long-term
contracts, and this is especially true for the larger
units regardless of region. If we focus on specific
geographical regions however, such as the North
Sea, we might even be tempted to entertain the
idea of a tight market, and in such events, the day
rates are quick to reflect the market situation.
And in fact, the North Sea is looking quite busy
this year, with a 20 % increase in exploration wells
compared to 2017 and 2016, and 20 ongoing field
developments on the Norwegian continental shelf
alone. Moreover, in the first half of the year we
saw seven applications for field developments
approved for the NCS, with a further three
expected to be approved within the next quarter.
It is also worth mentioning fleet development
in this setting. During the second quarter of the
year, only 28 newbuildings were delivered from
shipyards on a global basis, of which seven were
AHTS and six PSVs. Granted, a smaller number
of OSVs were scrapped this quarter than what
the market would like to see, but the amount
of supply vessels entering the market were also
low. So in essence, the market is moving in the
direction of a recovery, but as it stands now, it is a
painfully slow route ahead for the vessel supplier.
The Offshore Report, No. 3 -2018 3
NORTH SEA CHARTERING
Going into the 2nd quarter of 2018, we witnessed
a boom in the spot market for AHTS tonnage. This
uplift was mainly caused by the fact that seven high-
end AHTS’ were employed in work in connection with
the tow out of the Aasta Hansteen spar platform
from Stord to the site in the Northern Norwegian
Sea. This resulted in the highest reported rate levels
obtained in Norway for a long time, in fact touching
the NOK 1million per day mark. In the UK sector
of the North Sea however, the highest reported
rate was around GBP 70,000 per day. This was a
great relief to the ship owners with North Sea spot
exposure and a hope for more profitable months to
come. Even though the rates were favourable for the
Owners during the following few weeks, the activity
has levelled off. Comparing the rate levels obtained
from during April with those obtained in June, the
rate drop was considerable. In the UK sector, we
logged an average rate drop of about 73% while in
the Norwegian sector, the decrease is about 77 %.
During the last few weeks, we have however seen an
increase in spot rates, especially in the Norwegian
market, pushing the average reported spot rates
to about NOK 235,000 per day, with some peak
rates reported up about NOK 475,000 per day.
Looking at the market for PSV tonnage, we have
witnessed a firm activity level. Several PSVs have
been chartered at rates around NOK 200,000 per
day in a tight Norwegian market. In the UK however,
the market for PSV tonnage has been much more
volatile with variations between GBP 8,500 to GBP
22,000 per day. The positive expectations for the
spot market this summer have to some extent been
met. One reason behind the rates not being higher
4 The Offshore Report, No. 3 - 2018
is the steady reactivation of vessels from layup, in
addition to several vessels being relocated from
other areas to join the North Sea spot market.
On the other hand, Gazprom’s drilling campaigns
in the Kara and Pechora Sea have contributed to
several PSV and AHTS vessels relocating out of
the North Sea. The return of these to the North
Sea in 4th quarter 2018 may cause concern
to the balance in the North Sea spot market.
The activity level in term chartering has, during the
2nd quarter2018, been high. During this period,
we have logged as many as 35 term charters in
the North Sea (excluding Gazprom). These vessels
are predominantly PSVs and are chartered for
periods varying between duration of one well
(about 40-60 days) up to 2 years. The term rates
have improved, especially in the Norwegian
sector where PSVs regularly fix at rates between
NOK 125,000 and NOK 135,000 per day. Highest
term rate registered by us during this period is
about NOK 165,000 per day. In the UK sector,
term rates have been somewhat lower, varying
between GBP 7,000 and GBP 11,500 per day.
Finally, it is also interesting to note that out of the
vessels currently in layup, very few indeed are
less than 10 years old and hardly any are high-
end i.e. large deadweight PSVs or 22,000 BHP plus
AHTS. The notorious volatile North Sea summer
could still very much come into play as we move
into July with a potential tight vessel supply.
SPOT FIXTURE RATES
Please find below the high and low North Sea spot market ranges April - June 2018. (Rates in GBP per day excl. fuel).

TYPE APRIL MAY JUNE

AHTS 22.500 BHP + 5,400 - 90,600 5,800 - 41,200 6,000 - 44,000

AHTS <22.500 BHP 4,500 - 81,500 7,000 - 16,000 5,000 - 17,500

PSV Deck 900 m2 + 4,800 - 14,000 5,800 - 12,900 5,000 - 18,500

PSV Deck <900 m2 4,300 - 25,000 5,500 - 15,000 4,300 - 22,000

NORTH SEA TERM FIXTURE RATES

USD

70 000

60 000

50 000

40 000

30 000

20 000

10 000

PSV less than 750m2 deck PSV larger than 750m2 deck AHTS 12-16,499 BHP
AHTS 16,5-22,000 BHP AHTS 22,000+ BHP

The Offshore Report, No. 3 -2018 5

TERM FIXTURES
North Sea - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

MMT STRIL EXPLORER Offshore survey and ROV support, 18 Months 2018-04 MSV
Lundin Norway ISLAND CLIPPER Support COSL Innovator semisub, 98 Days 2018-04 PSV
Petrofac/Dana UK REM MISTRAL Support TO Leader, 77 Days 2018-04 PSV
Petrofac/Tullow UK BEN NEVIS Support Ensco 72 JU, 95 Days 2018-04 PSV
Petrofac/Tullow UK HIGHLAND PRINCESS Support Ensco 72 JU, 259 Days 2018-04 PSV
Siemens SUN ENABLER Walk-to-work Siemens, 8 Months 2018-04 MSV
TEAM/ASCO UK ISLAND CHAMPION Supply duties, 1 Year 2018-04 PSV
Perenco UK PORTOSALVO Supply duties, 83 Days 2018-04 PSV
Nordstream Group GEOSUND UXO clearance, 60 Days 2018-04 MPSV
Petrofac NOR VALIANT Construction support, 1 Month 2018-05 MSV
Total UK HAVILA AURORA Supply duties, 90 Days 2018-05 PSV
Hurricane UK/ Zennor SKANDI FEISTEIN Supply duties 2018-05 PSV
E. On EDDA FONN UXO clearance at Rampion wind farm, 1 Month 2018-05 MSV
Fugro GEOSEA Survey support, 3 Months 2018-05 MSV
James Fisher GO ELECTRA Wind-farm work, 3 Months 2018-05 MSV
Total UK HAVILA BORG Supply duties, 90 Days 2018-05 PSV
Ineos BOKA ATLANTIS Dive support, 45 Days 2018-05 DSV
Boskalis EDT JANE Construction support, 1 Month 2018-05 MPSV
NKT RELUME Mass flow excavation, 45 Days 2018-05 MSV
Apache WELL ENHANCER ROV well intervention at Bacchus field, 1 Month 2018-05 WELL INT.
Anasuria SKANDI FOULA Supply duties, 60 Days 2018-05 PSV
SBM VIKING NEPTUN FPSO mooring and buoy installation, 1 Month 2018-05 CON
NKT EDT HERCULES Cable maintenance, 1 Month 2018-05 MPSV
DeepOcean OLYMPIC COMMANDER Construction support, 45 Days 2018-05 MPSV
Neptune Energy OLYMPIC ELECTRA Walk-to-work , 3 Months 2018-05 MPSV
Seaway Heavy Lifting VOS PATRIOT Supply duties, 3 Months 2018-05 PSV
N-Sea DEEP CYGNUS Dive support, 100 Days 2018-06 LCV
Shell UK EDDA FRENDE Supply duties, 3 Years 2018-06 PSV
Maersk Olie & Gas HAVILA CLIPPER Supply duties, 2 Months 2018-06 PSV
EnQuest UK BRAGE TRADER Support TO Leader, 70 Days 2018-06 PSV
Total MAERSK INVENTOR Decommissioning, 80 Days 2018-06 CON

6 The Offshore Report, No. 3 - 2018

TERM FIXTURES
North Sea - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

Axxis Geo Solution HAVILA FORTUNE Seismic support, 6 Months 2018-06 PSV
Gazprom Geolograzvedka SIEM EMERALD All duties, 90 Days 2018-06 AHTS
Gazprom Geolograzvedka SIEM PEARL All duties, 90 Days 2018-06 AHTS
Total CONSTRUCTOR Dive support, 70 Days 2018-06 DSV
N-Sea RELUME UXO removal, 90 Days 2018-06 MSV
Maersk Oil UK FAR SERVER Support Ocean Valiant semisub, 730 Days 2018-06 PSV
Gazprom Geolograzvedka BRAGE VIKING Supply duties, 30 Days 2018-06 AHTS
Maersk Oil UK SEA TANTALUS Support Ocean Valiant semisub, 723 Days 2018-06 PSV
Chevron North Sea Ltd. SKANDI KVITSØY Support Ocean Guardian semisub, 140 Days 2018-06 PSV
Gazprom neft shelf BOA JARL All duties, 108 Days 2018-06 AHTS
Aker BP ISLAND DILIGENCE Walk-to-work on Tambar, 3 Months 2018-06 MSV
Gazprom Geolograzvedka NORSEA FIGHTER Supply duties, 90 Days 2018-06 PSV
Allseas ALP GUARD Towing Iron Lady barge, 80 Days 2018-06 AHT
Gazprom OLYMPIC CHALLENGER Walk-2-work support, 3 Months 2018-07 CON
TechnipFMC EDT HERCULES Construction support, 50 Days 2018-07 MPSV
Aker BP FAR SOLITAIRE Supply duties, 60 Days 2018-07 PSV
Gazprom Geolograzvedka SEA SPEAR Supply duties, 90 Days 2018-07 PSV
Gazprom Geolograzvedka SEA SUPRA Supply duties, 90 Days 2018-07 PSV
Gazprom Neft Shelf SAYAN POLARIS All duties, 106 Days 2018-07 MPSV
ConocoPhillips Norway NAO GUARDIAN Supply duties, 2 Months 2018-07 PSV
Aker BP NORMAND ARCTIC Supply duties, 4 Months 2018-07 PSV
Maersk Oil UK SEA SPRINGER Support hook up and commissioning, 270 Days 2018-07 PSV
Bluestream VOS SUGAR ROV inspection, 90 Days 2018-07 MSV
Aker BP NORMAND SKUDE Supply duties, 4 Months 2018-07 PSV
Nautical/Cairn UK GRAMPIAN SOVEREIGN Support Ensco 101 JU, 1 well firm 2018-07 PSV
Maersk Oil UK NORMAND FLIPPER Support hook up and commissioning, 270 Days 2018-07 PSV
Repsol OLYMPIC DELTA Walk-to-work Arbroath, 30 Days 2018-07 LCV
Maersk Oil UK STRIL MYSTER Supply duties, 60 Days 2018-07 PSV
DEA Norway OLYMPIC ENERGY Support Island Innovator semisub, 1 Well 2018-08 PSV
DEA Norway STRIL MAR Supply duties "Island Innovator" semisub, 1 Well 2018-08 PSV
DEA Norway ESVAGT CARPATHIA Errv duties, "Island Innovator" semisub, 1 Well 2018-08 STANDBY
Equinor NORMAND FERKING All duties, 1 Year 2018-09 AHTS

The Offshore Report, No. 3 -2018 7

TERM FIXTURES
North Sea - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

Wintershall Norway ISLAND CRUSADER Support TO Spitsbergen, 50 Days 2018-09 PSV
Wintershall Norway SKANDI GAMMA Support TO Spitsbergen, 50 Days 2018-09 PSV
Statoil SEVEN VIKING IRM , 5 Years 2019-01 MSV
Equinor ISLAND VICTORY Njord 2019 campaign, 30 Days 2019-07 CON
Equinor AKOFS SEAFARER Light well intervention, 5 Years 2020-01 WELL INT.
A/S Norske Shell SIEM PRIDE All duties, 5 Years 2020-11 PSV

Recently delivered MSV “Island Dilligence”

Photo courtersy of Island Offshore, photo by Gunder Tande

8 The Offshore Report, No. 3 - 2018

TERM FIXTURES
Africa, Mediterranean, Middle East, and India - a selection of representative fixtures 1st April to
30 th June 2018
CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE
Saipem VM LEGEND Supporting DLB Castoro 2, 8 Months 2018-04 AHT
Saipem VM PRIDE Supporting DLB Castoro 2, 8 Months 2018-04 AHT
Saipem VM PRUDENT Supporting DLB Castoro 2, 8 Months 2018-04 AHT
McDermott International PACIFIC PAPILLON Towing- and standby duties, 8 Months 2018-04 AHTS
Saipem SKANDI SAIGON Field support at Zohr, 45 Days 2018-04 AHTS
Supreme Hydro SEAMEC III Diving support, 52 Days 2018-04 DSV
Engineering
NPCC CCC MARITIME 1 Dive support, 6 Months 2018-04 MSV
NPCC CCC MARITIME 2 Construction support, 3 Months 2018-04 MSV
NOC BOURBON HAMELIN Field support at Al Shaheen, 2 Years 2018-04 PSV
TechnipFMC PACIFIC HERON Supporting at Block 32, 2 Months 2018-04 PSV
McDermott International SEACOR COURAGEOUS Pipelay support, 6 Months 2018-04 PSV
Topaz Marine TOPAZ ENERGY Bareboat, 3 Years (from Britoil) 2018-04 PSV
Topaz Marine TOPAZ POWER Bareboat, 3 Years (from Britoil) 2018-04 PSV
Exxon Mobil Nigeria WISE TIDE II Supply duties, 6 Months 2018-04 PSV
McDermott International BRITOIL 74 Construction support, 8 Months 2018-05 AHT
NOC HALUL 70 All duties, 3 Years 2018-05 AHTS
Hyundai Heavy Industries PACIFIC 38 Construction support, 8 Months 2018-05 AHTS
NOC TOPAZ RAYYAN Towing support at Al Shaheen field, 1 Month 2018-05 AHTS
Subsea 7 / L&T ZAKHER ALPHA Supporting DLB 1600 at Safaniyah field, 2 Months 2018-05 AHTS
Bunduq Oil Company ZAKHER POWER Field support, 5 Months 2018-05 AHTS
ENI Angola SKANDI SEVEN Construction support, 9 Months 2018-05 CON
Saipem ADAMS NOMAD Field support, 180 Days 2018-05 DSV
Saudi Aramco ADAMS AQUANAUT Cement block laying , 60 Days 2018-05 MSV
Shelf Drilling ASTERIE Supporting JU Adriatic 1, 3 Wells 2018-05 PSV
Shelf Drilling FANNING TIDE Supporting JU Adriatic 1, 3 Wells 2018-05 PSV
Qatargas HALUL 83 Supporting jackup at the North-Field, 2 Years 2018-05 PSV
Saipem Egypt HANDIN TIDE Pipelay support, 3 Months 2018-05 PSV
Shelf Drilling KENNY TIDE Supporting JU Adriatic 1, 3 Wells 2018-05 PSV
TOPIC POSH KITTIWAKE Supporting JU Jawhara 05, 2 Months 2018-05 PSV
ADNOC SEACOR RESOLUTE Supply duties, 6 Months 2018-05 PSV
McDermott International STANFORD GOSHAWK Supply duties, 8 Months 2018-05 PSV

The Offshore Report, No. 3 -2018 9

TERM FIXTURES
Africa, Mediterranean, Middle East, and India - a selection of representative fixtures 1st April to
30 th June 2018
CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE
McDermott International STANFORD OSPREY Supply duties, 8 Months 2018-05 PSV
Undisclosed ASTRO CAPELLA All duties, 7 Months 2018-06 AHT
Dubai Petroleum STANFORD SEAL Field support, 5 Years 2018-06 AHT
Sonangol Angola MEO SOVEREIGN 1 Supply duties, 8 Months 2018-06 AHTS
HHI PACIFIC 38 Supporting JU OML Intervention 1, 8 Months 2018-06 AHTS
ADNOC SAID ALETHEIA Cable installation and dive support, 1 Month 2018-06 DSV
Canyon Offshore OLYMPIC TRITON Trenching, 1 Months 2018-06 MPSV
Qatargas HALUL 81 Supply duties, 2 Years 2018-06 PSV
Qatargas HALUL 82 Supply duties, 2 Years 2018-06 PSV
Reliance PACIFIC GUILLEMOT Rig Support , 3 Months 2018-06 PSV
BP Egypt SEA SPARK Supply duties, 1 Year 2018-06 PSV
Chevron SEACOR MARLIN Supply duties, 1 Year 2018-06 PSV
Saudi Aramco SEACOR 888 All duties, 5 Years 2018-07 AHTS
Modec SKANDI SKANSEN FPSO Egina hook-up, 2 Months 2018-07 AHTS
NPCC SAID ALETHEIA Dive and ROV support, 5 Months 2018-07 DSV
Saudi Aramco SEACOSCO OHIO Supply duties, 5 Years 2018-07 PSV
Perenco BURCH WILLIAMS Supply duties, 10 Months 2018-08 PSV
ONGC GERIMAL IMR, 8 Months 2018-09 DSV
Petrobras SKANDI COMMANDER ROV support, 150 Days 2018-04 MSV
Kosmos Energy GEMSBOK Supporting DS ENSCO DS 12, 1 Well 2018-04 PSV
ExxonMobil HORN ISLAND Supporting DS Noble Bob Douglas, 3 Years 2018-04 PSV

North- and South America - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

Deep Gulf Energy HOS CLEARVIEW Supporting semi ENSCO 8503, 120 Days 2018-04 PSV
Deep Gulf Energy HOS CROCKETT Supporting semi ENSCO 8503, 120 Days 2018-04 PSV
Kosmos Energy KUDU Supporting DS ENSCO DS 12, 1 Well 2018-04 PSV

BP Canada LUNDSTROM TIDE Supporting semi West Aquirius, 4 Months 2018-04 PSV
ExxonMobil PARADISE ISLAND Supporting DS Noble Bob Douglas, 3 Years 2018-04 PSV
Kosmos Energy SPRINGBOK Supporting DS ENSCO DS 12, 1 Well 2018-04 PSV
Protexa JASCON 31 Accommodation support, 5 Months 2018-05 ACCOM.
Petrobras Brazil FAR SANTANA All support, 1 Year 2018-05 AHTS

10 The Offshore Report, No. 3 - 2018

TERM FIXTURES
North- and South America - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

PGS SKANDI CHIEFTAIN Seismic support , 120 Days 2018-05 MPSV
Undisclosed HORIZON GEOBAY Geotechnical survey, 2 Months 2018-05 MSV
BP Trinidad SABLE Supporting Rowan EXL II, 12 Months 2018-05 PSV
ExxonMobil SANIBEL ISLAND Supporting DS Noble Bob Douglas, 3 Years 2018-05 PSV
BP Trinidad WINE ISLAND Supporting Rowan EXL II, 12 Months 2018-05 PSV
Petrobras FAR SAGA ROV support, 2 Years 2018-06 MPSV
Pemex BOURBON ARTABAZE Stand-by duties, 915 Days 2018-07 AHTS
Petrobras FAR SCOUT WROV support, 1 Year 2018-07 AHTS
Petrobras SKANDI FLUMINENSE ROV support, 1 Year 2018-07 AHTS
Oceaneering NOR DA VINCI Construction support, 1 Month 2018-07 DSV
Petrobras SKANDI SALVADOR Construction support, 650 Days 2018-07 LCV
Diavaz GO ELECTRA All duties, 200 Days 2018-07 MSV
Petrobras SAVEIROS FRAGATA Supply duties, 1 Year 2018-07 PSV
Petrobras Brazil BOS TOPAZIO All support, 3 Years 2019-02 AHTS

CON “HOS Iron Horse”

Photo courtersy of Hornbeck Offshore Services

The Offshore Report, No. 3 -2018 11

TERM FIXTURES
Asia Pacific/Middle East - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

Ensco BRITOIL 121 Towage of JU ENSCO 107, 45 Days 2018-04 AHT
Petronas Carigali LANPAN 28 Supporting topside installation, 1 Month 2018-04 AHT
Undisclosed PACIFIC HAWK Supply duties, 60 Days 2018-04 AHT
Petronas Carigali POSH ASSISTOR Supporting topside installation, 1 Month 2018-04 AHT
Petronas BRIDGEWATER 131 All duties, 12 Months 2018-04 AHTS
Petronas BRIDGEWATER 132 All duties, 12 Months 2018-04 AHTS
Repsol Malaysia EXECUTIVE HONOUR Supporting JU PV Drilling, 3 Months 2018-04 AHTS
Inpex Australia FAR SCORPION Drilling support, 20 Months 2018-04 AHTS
CNOOC HAI YANG SHI YOU 291 Mooring leg replacement FPSO Nan Hai Sheng 2018-04 AHTS
Li, 5 Months
Petronas Carigali MICLYN EMPRESS Supporting topside installation, 1 Month 2018-04 AHTS
EnQuest OMNI MARISSA All Support , 7 Months 2018-04 AHTS
Vestigo Petroleum PACIFIC WRESTLER Supporting FSO Nautica Muar, 1 Month 2018-04 AHTS
Petronas Carigali SWIBER CHALLENGER Supporting topside installation, 1 Month 2018-04 AHTS
Shell TIME LIZA Supply duties, 2 Months 2018-04 AHTS
Indonesia Global Gateway BOLD MAVERICK Cable survey, 2 Months 2018-04 CLV
Brunei Shell Petroleum SAPURAKENCANA Replacing submerged turret production buoy, 1 2018-04 CON
(BSP) CONSTRUCTOR Month
Shell ARMADA TUAH 300 IMR, 7 Months 2018-04 MPSV
Shell EXECUTIVE TIDE Supply duties, 2 Months 2018-04 MPSV
Woodside Myanmar PACIFIC LEGACY Drilling support, 60 Days 2018-04 PSV
Woodside Myanmar PACIFIC LIBERTY Drilling support, 60 Days 2018-04 PSV
JX Nippon EXECUTIVE PRIDE All duties, 30 Days 2018-05 AHTS

Carigali Hess PERDANA ADVENTURER Production work, 1 Year 2018-05 AHTS

ConocoPhilips PERDANA EXPEDITION Drilling support, 80 Days 2018-05 AHTS
Chevron SMS SERENITY All duties, 1 Month 2018-05 AHTS
Petronas SWIBER SAPPHIRE All duties, 45 Days 2018-05 AHTS
Petronas Carigali TIME RINA Supply duties, 90 Days 2018-05 AHTS
Shell VALLIANZ HOPE Field support, 2 Months 2018-05 AHTS
MMHE NAUTICAL ADLIN Hook-Up, 40 Days 2018-05 Maint.
Shell Sarawak EXECUTIVE STRIDE Field support, 2 Months 2018-05 MPSV
Sakhalin Energy GREATSHIP MAYA IMR, 170 Days 2018-05 MPSV
Shell Sarawak EXECUTIVE EXCELLENCE Field support, 2 Months 2018-05 PSV

12 The Offshore Report, No. 3 - 2018

TERM FIXTURES
Asia Pacific/Middle East - a selection of representative fixtures 1st April to 30 th June 2018

CHARTERER VESSEL NAME WORKSCOPE + PERIOD DELIVERY TYPE

Conocophilips MERMAID LEEUWIN Supporting JU Noble Tom Prosser , 8 Months 2018-05 PSV
Inpex Australia SEA TORTUGA All support , 5 Months 2018-05 PSV
ExxonMobil Malaysia TANJUNG PINANG 1 Supply duties, 1 Year 2018-05 PSV
ExxonMobil Malaysia TANJUNG PINANG 3 Supply duties, 1 Year 2018-05 PSV
Total MAERSK LEADER Towage of FSO Ailsa , 70 Days 2018-06 AHTS
Total MAERSK LIFTER Towage of FSO Ailsa , 70 Days 2018-06 AHTS
Total MAERSK TOPPER Towage of FSO Ailsa , 70 Days 2018-06 AHTS
Total MAERSK WINNER Towage of FSO Ailsa , 70 Days 2018-06 AHTS
Subsea 7 MMA CORAL Assisting barge, 60 Days 2018-06 AHTS
CNOOC HAI YANG SHI YOU 287 Dive support, 180 Days 2018-06 CON
Undisclosed SURF ALLAMANDA Well intervention, 2 Years 2018-06 LCV
Prosper Energy SETIA SAKTI Bareboat, 2 Years 2018-06 MSV
CAV Energy NORSHORE ATLANTIC Bareboat, 4 Months 2018-06 WELL INT.
Shell Brunei EXECUTIVE ASPIRE Supportining semi Deepwater Nautilus, 3 Years 2018-07 AHTS
US Government HOS MYSTIQUE ROV support, 90 Days 2018-07 MPSV
US Government OCEAN INTERVENTION ROV support, 90 Days 2018-07 MSV
i-Tech MMA PINNACLE Life of field services, 3 Years 2018-09 MSV

AHTS “Far Scorpion”

Photo courtersy of Solstad Farstad

The Offshore Report, No. 3 -2018 13

FROM THE TIGER’S MOUTH
Coming off a fiery first quarter, the second quarter
felt like England’s second half performance in the
World Cup semifinal against Croatia. Only a hand
full of tenders/market surveys were released
during the first half of the second quarter while at
the same time many of short-term jobs concluded
releasing a large number of active and reactivated
vessels into the market. Furthermore, another
significant setback for the market balance was
the suspension of the ‘Red emperor’ project in the
South China Sea. Just days prior to commencement/
mobilization of the support vessels and drilling rig,
the owners received notice of suspension for the
project due to operations that were to take place
in disputed waters between China and Vietnam.
The second quarter has not been all doom and
gloom though, as it has produced some regional
highlights such as ENI Indonesia picking up three
large AHTS (>250T BP) for their East Kalimantan
project to support their drilling campaign with
the semi Kan Tan IV. Furthermore, Shell Brunei
awarded a package of three AHTS to support
its developments offshore East Malaysia for a
duration of three years. Owners are yet to hear
the results for the accommodation unit, utility
vessels, and crew boats, all of which are expected
to be announced shortly. In Vietnam, we have seen
several requirements for medium to large AHTS
and PSV for shorter-term contracts for drilling
support and towing work scope. Malaysia has kept
the accommodation workboat fleet busy with short-
to medium-term contracts, giving a welcomed
lift in accommodation workboat dayrates. And in
14 The Offshore Report, No. 3 - 2018
Australia, Inpex chartered two PSVs for the Ichthys
LNG project supply duties work scope. Despite the
occasional spur of activity in South East Asia, day
rates remain under pressure and, unfortunately for
the owners, further pressure on rates is added when
laid up boats are reactivated. To date we have only
seen a few handfuls of reactivations, however we
expect this number to increase in the third quarter
as contractors are planning their drilling campaigns
for late 2018 and into 2019. In support of this, we
are starting to see an increase in market surveys
for vessel availability and budgeting purpose.
The sale and purchase market has not lived up to
the activity of 2017, that said we are still seeing a
number of vessels changing hands, mainly in the
lower end with 5150s being the in-demand size for
deployment in markets from Africa trough Middle
East to Asia. 5,000 dwt PSVs are also gaining traction
in the sale and purchase market with a few units
already concluded and rumors of more to come.
While waiting for recovery, Singapore owners
are looking elsewhere to employ their assets.
Renewables is the rising star and in particular
offshore wind. The future offshore wind
Industry in Taiwan could very well be one of the
bright spots we have been looking for, having
already seen the first phase contracts awarded
sparking hope and optimism among owners.
Well Intervention vessel “Norshore Atlantic”
Photo courtersy of Van Aalst Group

ASIA PACIFIC TERM FIXTURE RATES

USD
40 000

35 000

30 000

25 000

20 000

15 000

10 000

5 000

AHTS 12-16,499 BHP PSV larger than 750m2 deck PSV less than 750m2 deck
AHTS 10-11,999 BHP AHTS 7-9,999 BHP AHTS 5 - 6,999 BHP

The Offshore Report, No. 3 -2018 15

WHAT LIES BENEATH
The second quarter of the year has been a
mixed bag for the subsea segment. While some
companies’ efforts to position themselves have
proven fruitful, other, even among the largest
contractors, have struggled to attract new in
any significant degree and are still experiencing
a significant orderbook deficit. There are clear
positive developments that are worth mentioning
however, chiefly that the rates achieved on
forward commitment have increased compared
to 2017 and also that the number of IMR awards,
both new as well as extensions, have picked up.
This could indicate a firm commitment to future
developments from the oil companies’ point of
view, and thereby offer the chance for some
optimism for the shipowner with the right assets.
Late June McDermott’s consortium with Baker
Hughes proved beneficial as it was awarded an
integrated subsea contract (SURF+SPS) by Posco
Daewoo for the Shwe tie-back offshore Myanmar.
Having previously won the FEED for this project,
the shared interest proved the most competitive
as the two companies jointly will EPCIC for this
brownfield development from 2019 until 2022.
In addition to the above, McDermott also saw
a number of awards in of different sizes won
this quarter, including installation contracts in
Vietnam for PTSC, Anadarko in the US Gulf, and
for Saudi Aramco’s at its Safaniya field, as well
as combined scopes of diving and construction
with its LAYSV “Amazon” for JV
Saipem lacked media presence this quarter
with only a limited amount of awards won.
Granted, the pipeline EPIC award in Qatar is
16 The Offshore Report, No. 3 - 2018
worth $1.3 billion, but other than that, the
company only announced two awards. In late
April, Saipem announced a decommissioning
scope for ConocoPhillips’ Loggs satellite location,
while towards the end of the quarter a life-
of-field contract for Petrobel’s Zohr gas field
development was announced in consortium
with Petroleum Marine Services. The value of
the latter two contracts are yet to be disclosed.
Much of the same can be said about TechnipFMC
that also only saw a handful of strategic and sizeable
awards this quarter. In mid-April, the company
announced that it had been awarded the Tortue
FPSO FEED by BP, which includes an EPIC option,
albeit McDermott, together with Baker Hughes,
has FEED for subsea scope on the project. Then,
in late May, TechnipFMC confirmed that it had
been awarded the Liuhua SPS scope by CNOOC,
which covers 26 subsea trees, manifolds, subsea
control systems, wellheads, and tie-in systems, as
well as support services during installation and
commissioning. Lastly, right at the end of this
period, TechnipFMC announced an EPC award
for the subsea production equipment for Total’s
Zinia Phase-2 development offshore Angola,
but it should be noted that Subsea 7 already
has contract for subsea construction on this
project covering EPIC of flowlines and umbilicals.
Speaking of which, Subsea 7 was by far the
SAPREF. busiest of the Tier 1 contractors this quarter,
with a total of seven sizeable awards including
the aforementioned Zinia scope, and a further
couple of smaller (less than $50 million) pipelay
awards in the UK and the US Gulf. The sizeable
awards include SURF EPIC for Shell’s Vito and
Penguins field developments, Burullus’ next
subsea construction phase of the West Delta
Deep Marine development, a multi-service
contract with MPN to support the Production
Uplift Pipeline Projects offshore Nigeria, and
BP’s tie-back development Alligin. Since our last
report, Subsea 7 also completed the acquisition
of Siem Offshore Contractors, including the
two specialized vessels CLV “Siem Aimery”
and SOV “Siem Moxie”. The new business unit
will be placed within the Renewables and
Heavy Lifting segment in the organisation.
It has also been a busy quarter for the IMR
segment, at least in terms of new contract
awards. Above mentioned Subsea 7 saw it’s ROV
inspection and subsea intervention contract with
Equinor for the JV owned MSV “Seven Viking”
extended five years firm to the end of 2023. The
contract, which also includes three yearly options
to extend, value is in excess of NOK 1 billion,
according to Equinor. In the US Gulf, Edison
Chouest subsidiary C-Innovation secured a
three-year IRM and subsea construction contract
with BP, which will see several vessels utilized,
including CON “Island Venture”. Beyond this, a
number of multi-year framework agreements
for IMR related services was awarded this
quarter especially in the North Sea region. Reach
Subsea, Bibby Offshore, IKM, DeepOcean, and
N-Sea were all recipients of long-term frame-
agreements, as well as a vast number of shorter
contracts. Most of all DOF Subsea announced a
series of IRM and subsea related term contracts
and frame agreements, including contracts
in Brazil, the North Sea, the Atlantic region.
After this quarter, all the major subsea players
with cooperative efforts have won significant
awards on integrated basis with the exception
of the Aker Solutions and Saipem alliance.

Construction vessels
140 000 Rate level (USD)
120 000

100 000

80 000

60 000

40 000

20 000

-
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Light construction vessels

Rate level (USD)
70 000 The Offshore Report, No. 3 -2018 17
60 000
50 000
40 000
S&P AND CORPORATE
As reported in our December report of 2017, Mc-
Dermott International made an agreement with
CB&I to merge in an all-stock transaction. How-
ever, in April of this year, Christian Siem controlled
Subsea 7 proposed to acquire McDermott, sub-
ject to the termination of the CB&I transaction,
which was scheduled to be completed in May.
After days of speculation, about 75% of the McDer-
mott shareholders voted for the proposed merger
with CB&I, and subsequently, Subsea 7 withdrew
their offer. The transaction was completed in May.
Herbjørn Hansson-chaired Nordic American Off-
shore (NAO) has come to an agreement with its
creditors for a 20-month extension on its waiv-
ers. Originally, the company had negotiated a $60
million facility with its lenders back in 2013, but
this was later increased to $150 million in 2015,
and have since been in breach of three covenants
under their loan agreement. The new deal will
see the company extend the maturity of its debt
from 2018 to 2020. In mid-April, Dutch shipping
company Vroon reached an agreement of terms
with all of its lenders regarding its financial re-
structuring. The details around the agreement on
the restructuring have not been fully disclosed,
however, it will see Coco Vroon step down as
managing director of the group; a position which
he has held since 1995. French giants Bourbon
Offshore Services has signed a waiver with its
creditors, allowing the company to withhold pay-
ments on its outstanding loans and debt services.
Singapore based owner Pacific Radiance has filed
for court protection as suppliers have been trying
to wind the company up. The company is seeking
18 The Offshore Report, No. 3 - 2018
a six-month immunity from legal proceedings, as
it is trying to provide stability for its day-to-day
operations and also to support its customers.
Meanwhile, US based Harvey Gulf has seen its pre-
packaged Chapter 11 bankruptcy plan approved,
just 77 days after filing. The plan, which will see
$1.2 billion in debt being swapped for equity
will, according to a statement, save the company
some $47 million in annual debt service costs.
In early May, Hornbeck Offshore Services an-
nounced the purchase of four US flagged PSVs
from Aries Marine. The fleet of four vessels, in-
cluding two Aker PSV 23DE designed PSVs in ad-
dition to two LDS270DE designed PSVs, were
acquired for a total price of USD 36.6 million en
bloc. Norwegian giants have offloaded a total
of six vessels during the second quarter of 2018
through its subsidiaries. The vessels include the
two remaining P-729 designed AHTS (ex. DESS
fleet), one Khiam Chuan designed AHTS (ex. Sol-
stad Asia), in addition to two UT 722 designed
AHTS and one UT 750 designed PSV (ex. Farstad).
The company, which is continuously extending its
loan agreement with its main creditors through
Solship Invest 3 AS, will further remove the
“Farstad” name, and the name change to Solstad
Offshore ASA to come into effect later this year.
In late June, Swedish registered Viking Supply
Ships announced that they have entered into an
agreement with an unnamed party to sell three
of its five remaining PSVs. The vessels Freyja Vi-
king (built 2007), and Nanna Viking & Sol Viking
(both built 2006) are expected to be delivered to
its new owners in July, following the reactivation
of all three vessels in Uddevalla, Sweden, for sell-
ers account. Following its acquisition of the 11 x
UOS AHTS’ earlier this year (and also the 2 X ER
AHTS), Hayfin Breakwater has agreed to acquire
both the commercial- and technical management
business of both United Offshore Support GmbH
& Co KG and Hartmann Offshore GmbH & Co KG.
The companies will provide technical and com-
mercial management services for the 13 AHTS’.
Just as we were prepared to issue our market re-
port, the news broke that American shipowners
Tidewater and GulfMark are merging to create a
“Global Offshore Leader”. Both companies have
recently emerged from Chapter 11 proceedings
with significantly less debt and financial leeway
for the tough market still ahead. With a combined
fleet of 245 supply vessels, the new organization
will be the largest in terms of number by a large
margin, and control 25 % more PSVs and AHTS
than the second largest. Moreover, the new or-
ganization will own/operate more than 100 ships
that is described by Tidewater as tier 1 vessels, of
which the average age is around 6,5 years. Fur-
thermore, according the press release, the com-
pany will be well position to “capitalize on organic
growth opportunities and to pursue additional ac-
quisitions.” The projected transaction is currently
on track to close during the fourth quarter 2018.

SALE AND PURCHASE

Selected transactions in the period 1st April to 30 th June 2018
TYPE VESSEL NAME BUILT SELLER BUYER
PSV DWIGHT S. RAMSAY 2010 ARIES MARINE HOS
PSV BETTY PFANKUCH 2011 ARIES MARINE HOS
PSV RAM NATION 2014 ARIES MARINE HOS
PSV RAM COUNTRY 2015 ARIES MARINE HOS
AHTS RAGNHILD K 2008 ASIAN OFFSHORE I CASPIAN MARINE SERVICES LTD
AHTS JMH6026 2016 ASL SHIPYARD INTAN SCORPIO PTE LTD
MSV VISSOLELA 2004 BOURBON GEOXYZ
PSV SEA MEADOW 06 1976 EAGLE SHIPPING SEASCAPE MEADOW INVEST
HTV EIDE TRANSPORTER 1988 EIDE BANKRUPTCY ESTATE EDE SHIPPING CORPORATION
AHT LEWEK KESTREL 2007 EMAS OFFSHORE GAC
AHT LEWEK KEA 2008 EMAS OFFSHORE GAC
AHTS IKALUK 1983 FEMCO CHINESE BUYERS
AHTS MALAVIYA NINE 2008 GOL OFFSHORE ZOUROS
AHTS SK LINE 905 2018 GUANGZHOU HANGTONG TOPAZ MARINE
SHIPBUILDING

The Offshore Report, No. 3 -2018 19

SALE AND PURCHASE
Selected transactions in the period 1st April to 30 th June 2018

TYPE VESSEL NAME BUILT SELLER BUYER

AHTS LAMNALCO MARABOU 2009 LAMNALCO AFRIKDELTA SHIPPING SERV
PSV CARIBE 2018 MAC OFFSHORE COLUMBIAN MARINE
PSV MAERSK NASCOPIE 1996 MAERSK A1 OFFSHORE SOLUTIONS
PSV MAERSK NORSEMAN 1996 MAERSK A1 OFFSHORE SERVICES
PSV MAERSK FRONTIER 1992 MAERSK EAGLE SHIPPING
BARGE DINA LAUNCHER 2009 MYKLEBUSTHAUG TRONDS MARINE
PSV SK LINE 719 2016 NAM CHEONG HALUL OFFSHORE
PSV ODYSSEA QUEST 2003 ODYSSEA VESSELS ANGELA CHERAMIE
SEISMIC SUP BRAVO SUPPORTER 1998 OPSTAD OFFSHORE SILVER SEA
AHT CREST TITAN 2 2010 PACIFIC CREST ALLIANZ MARINE
DLB N/B JSD 6000 TBN 2017 PETROFAC ZPMC
ACC. BARGE AWB 1570 2016 POET ARIOSH
AHT AHT VALIANT 2015 POET HALUL OFFSHORE
AHTS RT KRIS 2010 RIG TENDERS OFFSHORE OCEANINDO PRIMA SARANA
AHTS FAR SAILOR 1997 SOLSTAD FARSTAD MORSPAS
AHTS FAR SENIOR 1998 SOLSTAD FARSTAD MORSPAS
AHTS NOR CHIEF 2008 SOLSTAD FARSTAD NIGERIAN BUYERS
AHTS SEA JACKAL 2011 SOLSTAD FARSTAD PERENCO
AHTS SEA BADGER 2011 SOLSTAD FARSTAD HAI DUONG
PSV FAR SUPPORTER 1996 SOLSTAD FARSTAD HAI DUONG
AHTS LEWEK LYNX 2011 STANDARD CHARTERED KIM HENG OFFSHORE & MARINE
AHTS ROGELIO TIDE 2011 TIDEWATER HAI DUONG
PSV DAMON B BANKSTON 2002 TIDEWATER SEAFREEZE
PSV SOL VIKING 2006 VIKING SUPPLY SHIPS NIGERIAN BUYERS
PSV NANNA VIKING 2006 VIKING SUPPLY SHIPS NIGERIAN BUYERS
PSV FREYJA VIKING 2007 VIKING SUPPLY SHIPS NIGERIAN BUYERS
PSV SEA GOLDCREST 2018/19 FUJIAN MAWEI SEATANKERS
PSV SEA GULL 2018/19 FUJIAN MAWEI SEATANKERS
PSV SEA HERON 2018/19 FUJIAN MAWEI SEATANKERS
PSV SEA HORNBILL 2018/19 FUJIAN MAWEI SEATANKERS

20 The Offshore Report, No. 3 - 2018

AHTS “Far Sailor” PSV “Maersk Nascopie”

AHTS “Sea Jackal”

PSV “Freyja Viking”

MSV “Vissolela” AHTS “Nor Chief”

The Offshore Report, No. 3 -2018 21

VESSELS SOLD TO RECYCLING
Selected transactions in the period 1st April to 30 th June 2018

TYPE VESSEL NAME BUILT SELLER

AHT MARZAMEMI 1977 AUGUSTEA
AHT GAL ROSS SEA 1982 GOL OFFSHORE
AHT GAL BEAUFORT SEA 1982 GOL OFFSHORE
AHTS SEASAFE SYNERGY 1973 AMSBACH OFFSHORE
AHTS BIN HAI 283 1984 CHINA OFFSHORE OIL
AHTS AL SADD 1984 SEA SHELL SHIPPING & MARINE
AHTS ESVAGT GAMMA 1985 ESVAGT
AHTS SEACOR VOYAGER 1998 SEACOR MARINE
AHTS HALUL 64 2018 L&T SHIPBUILDING
AHTS MALAVIYA TWENTY THREE 2007 GOL OFFSHORE
DSV ROCKWATER 1 1983 SUBSEA 7
MSV REVELATION 1975 SEAMEC
PSV EAGLE RIVER 1984 SEAPORT INTERNATIONAL SHIPPING
PSV HALUL 48 2018 L&T SHIPBUILDING
PSV HALUL 47 2018 L&T SHIPBUILDING
PSV HALUL 46 2018 L&T SHIPBUILDING
STANDBY ESVAGT PROMOTOR 1969 ESVAGT
STANDBY PUTFORD ROVER 1982 SEACOR MARINE

DSV “Rockwater 1” Aftermath of cyclone at L&T Shipbuilding

22 The Offshore Report, No. 3 - 2018

COMPANY INFO 24 HOUR SERVICE: +47 22 93 64 00

Oslo Office: Direct Lines Mobile: E-mail

Tor A. Widing +47 22 93 63 21 +47 90 16 10 79 taw@fearnleys.no

Erik C. Askvig +47 22 93 61 26 +47 93 21 39 03 eas@fearnleys.no

Harald F. Askvig +47 22 93 61 22 +47 92 20 35 51 has@fearnleys.no

Espen Boger +47 22 93 63 22 +47 91 84 27 40 eb@fearnleys.no

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Christian Evans +47 22 93 63 24 +47 91 88 78 30 cev@fearnleys.no

Martin Hestnes +47 22 93 63 28 +47 90 16 10 81 mah@fearnleys.no

Kristian Kjølhamar +47 22 93 63 19 +47 97 02 36 81 kkj@fearnleys.no

Nina Skeie +47 22 93 63 23 +47 97 54 13 21 ns@fearnleys.no

Jesper Skjong +47 22 93 64 25 + 47 90 24 40 98 jes@fearnleys.no

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Singapore Office: Direct Lines: Mobile: E-mail:

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Bensen Ni +65 6305 0468 +65 9295 6441 b.ni@fearnleys.com

The Offshore Report, No. 3 -2018 23

 FEARNLEY OFFSHORE SUPPLY AS
P.O.Box 1158 Sentrum
N-0107 Oslo, Norway
Phone: +47 22 93 64 00
supply.offshore@fearnleys.no

FEARNLEY OFFSHORE SUPPLY PTE. LTD.

Winsland House I
3 Killiney Road, #04-06/07
Singapore 239519
Phone: +65 6305 0461
supply@fearnleys.com.sg

FEARNLEY OFFSHORE L.L.C.

One Riverway, Suite 1810
Houston, Texas 77056
Phone: +1 713 629 7072
Fax: +1 713 629 7073
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www.fearnleyoffshoresupply.com

Achilles JQS

Qualified
ERRV “Esvagt Dana”
Photo: Zamakona Yards